Gotti turning hawkish:
…Come June, there has been a significant surge in demand in all states except Victoria. Many are reporting sales rising above five per cent, which represents a significant movement.
…In recent years, my retail information group has been very accurate in relaying to the community (sometimes including the RBA) what is actually happening in the retail sector, particularly in the areas outside the 30 per cent of people who are mortgage or rent stressed. Accordingly, I am very confident about conveying this sudden switch.
There is little doubt that the rising spending has been triggered by the anticipation of tax cuts…
I can’t vouch for Gotti’s retail group. The old goat has good sources but he can be subject to recency bias in whoever he last spoke to.
What we can say is that there is no evidence yet of the surge in Nowcasting retail indexes such as Westpac’s credit card tracker:
Or the CBA’s household spending intentions index:
Admittedly, these run through to the beginning of June but are supposed to be forward-looking.
The only other dimension I would add is that the last few weeks have delivered much colder weather and that can trigger a surge in activity as folks renew winter clothing, heating, recreation, etc.
It’s not impossible that we’ll see a spike.
